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Abdul Hafeez Shaikh says government inherited economic crisis

Abdul Hafeez Shaikh says government inherited economic crisis
June 11, 2020
ISLAMABAD (92 News) – Adviser to Prime Minister Imran Khan on Finance Abdul Hafeez Shaikh has said that the present government had inherited economic crisis. Launching the Economic Survey for FY2019-20 in Thursday, he said that expenditures had been more than income this year. “Exports increased by keeping the dollar cheap,” he said. The adviser claimed that the government had returned loans amounting to US$5,000 through the effective strategy. “We have brought the deficit of Rs20 billion to Rs3 billion. We helped the 16 million families,” he said. Abdul Hafeez Shaikh thanked Chief of Army Staff General Qamar Javed Bajwa for freezing the army budget. He said that exports growth was zero during the past governments. “It should be looked why the loans were increased. Why did the previous government keep the dollar at a low rate? As a result, imports doubled as compared to exports. In the past, the growth was gained by getting loans,” he maintained. The adviser said that the past rulers associated themselves with the International Monetary Fund (IMF) for their benefits. “We will make an effort not to impose a new tax in the next fiscal year. Taxes will be reduced due to the coronavirus situation,” he said. About the Economic Survey for 2019-20, he said that a 73 percent decline in current account deficit, bringing it down from US$20 billion to US$3 billion. He said that the fiscal deficit had been curtailed to 4 percent of the GDP from 5.1 percent of the previous year. “Owing to the negative impact of COVID-19, the growth rate remained 0.4 percent against the estimated 3 percent.” Giving the break-up, the adviser said that the agriculture sector had recorded strong growth of 2.67 percent considerably higher than 0.58 percent growth achieved during the last year. The provisional growth in industrial sector had been estimated at minus two point six four percent mainly due to the negative growth of 8.82 percent in mining and quarrying sector and decline of 7.78 percent in large scale manufacturing sector. Due to lockdown situation in the country, the growth estimates of small scale industry for the outgoing fiscal year are 1.52 percent. The services sector has declined provisionally at 0.59 percent mainly due to 3.42 percent decline in wholesale and retail trade sector and 7.13 percent decline in transport, storage and communication sectors. The finance and insurance sector witnessed a slight increase of 0.79 percent. The Housing Services, General Government Services and other private services have contributed positively at 4.02, 3.92 and 5.39 percent respectively. During the first seven months of fiscal year, inflationary pressures were observed and inflation rose to 14.6 percent in January this year. Owing to government's timely measures, the Consumer Price Index declined to single digit at 8.5 percent in April this year. This was third successive month showing decline in inflation, whereas it dropped more than six percent in last three months. The total imports during the first ten months of the outgoing fiscal year declined to US$36.1 billion as compared to US$40.3 billion last year, registering a decline of 16.9 percent. During the first 10 months, remittances also increased to US$18.8 billion as compared to US$17.8 billion during the same period of the previous year.